If 2021 had a theme, it would be resilience. Every type of organization across the globe was forced to pivot, react, and respond on a compressed timeline to countless emerging challenges, risks, and in some cases disasters. While risk, compliance, safety, and healthcare professionals faced down a variety of their own individual challenges and risks – from telemedicine and medical IoT devices to cybersecurity, the presence of private equity in the RMIS space, and the rise of ESG – four trends in particular accounted for a lion’s share of the disruption:
- Supply Chain
- Natural Disasters & Climate Change
- Talent Shortages — The Great Resignation
Some trends, like COVID-19, come as no surprise as we enter into the third year of the pandemic, while others, like acute supply chain pressures, intensified seemingly overnight. As we reviewed this year’s trends, one thing was certain – these four risks emerged rapidly, grew exponentially, and have the potential to disrupt industries across the board well into 2022 and beyond.
COVID-19: Vaccinations, Regulations, & Emerging Variants
With news of the new omicron variant dominating headlines as of late, it’s easy to forget the incredible journey we’ve been on in just the first half of 2021 alone. From the historic development and deployment of the vaccine, the challenges that came with employee vaccination and testing mandates, to the ever present threat of a new variant and the complications that come with it, 2021 has unfortunately been another year overcome by the global pandemic. And if COVID has taught us anything these last two years, it’s that operational resilience will be key heading into 2022.
While there have been countless sub-trends that the pandemic has created this year, the shifting employee vaccination and testing mandates, complicated ethical and privacy issues regarding storing such data, and the cybersecurity concerns rising from the work-from-home and hybrid work environments will persist as we head into 2022. The role of technology in mitigating those related risks will be key.
As we’d stated in an article on the Delta variant earlier this year, “over the course of the pandemic, each new development has brought with it additional challenges for organizations to solve. Being able to use technology to reduce the burden placed on resources charged with implementing these programs is a worthy goal, but only if those solutions are flexible enough to support the unique combination of policies and procedures your organization has chosen.”
As organizations head into the new year, having a solution in place to adjust to the next COVID-19 developments as they emerge will be critical to long-term success.
Read Next: How to Track & Manage Employee Vaccinations and COVID-19 Tests
The Global Supply Chain: Disruption or Crisis?
With COVID-19 as a catalyst for what’s being heralded as a “supply chain crisis,” the March 2021 blockage of the Suez Canal put an international spotlight on just how interwoven and fragile the global economy is. As a result, a waterfall of vendor and supply challenges have riddled industries across the board – from critical PPE supplies for healthcare organizations to computer chips that have shaken the technology and automobile industries, and scrambled logistics on things as simple as renting a car for business travel. While a long-term resolution isn’t yet clear, it’s anticipated that this is a crisis that won't be over anytime soon.
Pre-COVID, supply chain was barely a thought for many risk professionals. The New York Times recently published that “we didn’t even have a logistics beat before the pandemic. Now we do.” Fast forward to the end of 2021 and it’s a topic landing above the fold in every major publication around the globe.
If you’ve made it this far into the year and are thinking that supply chain disruption isn’t a risk that has a direct impact on your organization, then you’re looking at it the wrong way – because this is a topic that’s keeping your clients, vendors, and their subsequent clients and vendors up at night. As with the other trends this year, this one doesn’t allow for some to sit on the sidelines — everyone has to figure out a way through.
Read Next: How to leverage strategic vendor risk management against supply chain risks
Natural Disasters: Is “The Day After Tomorrow” Here?
Natural disasters these past few years aren’t necessarily to the magnitude of those in the 2004 American science fiction disaster film The Day After Tomorrow, but the impacts of them to organizations globally are feeling close to it.
In the white paper Operational Resilience in a Time of Extremes: Is Your BCM Program up to the Challenge, the author states that the unusual nature of 2020’s natural disaster season “placed a spotlight on the importance of Business Continuity Management (BCM) and operational resilience plans,” but for many organizations, their recovery plans weren’t sufficient after being tested by “an unprecedented series of natural disasters on top of a global pandemic.” According to the 2021 Intergovernmental Panel on Climate Change (IPCC) report:
Human-induced climate change is already affecting many weather and climate extremes in every region across the globe. Scientists are also observing changes across the whole of Earth’s climate system; in the atmosphere, in the oceans, ice floes, and on land.
Many of these changes are unprecedented, and some of the shifts are in motion now, while some - such as continued sea level rise – are already ‘irreversible’ for centuries to millennia, ahead.
Setting aside the politics of climate change, it’s apparent that the magnitude and growing duration of natural disaster seasons on a global scale is producing risks that weren’t previously on most organizations’ radars. With lessons from 2020’s natural disaster season still ringing true as we transition into 2022, it’s critical for risk professionals across the board to ask themselves whether their BCM plan positions them to take on the next “unprecedented” disaster or be overcome by it.
Read Next: How to integrate operational resilience into your BCM program for 2022
The Great Resignation: A Long-Lasting Shift in Attitudes Towards Work?
What’s being heralded as “The Great Resignation” has seen employees quitting in record numbers, with over eight million professionals resigning from their positions from August to September alone. This preview of what may be the “new normal” has sent employers scrambling to rethink hiring practices, compensation packages, and business models.
However, for risk professionals, it’s producing a slew of new risks for organizations across the spectrum – from workers’ compensation self administrators to safety and enterprise risk specialists. According to CBIZ, one of the US’s largest HR services providers, businesses are experiencing challenges filling jobs with experienced workers which have led them to hire “a large number of inexperienced workers. Unfortunately, this practice comes with workers’ compensation risks. Inexperienced personnel can lack safety training and may be more willing to take unnecessary risks.”
As we concluded in our quick take on this trend, “the Great Resignation reflects a shift in attitudes toward work that may be long-lasting. On the surface, it appears to be a recruiting and retention challenge. But the risks run deeper, from the ‘brain drain’ to overstretched staff to workers in roles they weren’t meant to occupy. How well employers [...] respond to these emerging risks could have implications for their business success far into the future.”
Whether the Great Resignation is here to stay is yet to be determined. But it’s clear that this is a trend that’s going to follow risk professionals well into the new year and influence other compounding risks.
The Next Move: What To Do in 2022
While we’ve tried to predict the future, we all know the best litmus for what’s to come is to have a firm understanding of the past and present. Whether these trends are going to continue well beyond 2022 is yet to be determined, but it’s almost certain that they’ll take hold of 2022 and create further disruption themselves, or create new trends that will do the job for them. These risk trends, among others, emerged rapidly, and it’s almost guaranteed that new risks will do the same in the new year. So where does that leave risk professionals?
As we head into the new year, it’s critical not to sit on the sidelines. These risks are happening now and decisions that organizations make today can have a profound impact – whether positive or negative – on the long-term resilience of their organization into the new year and beyond.